Like death and taxes, it would appear that stamp duty is another certainty of life. However, unlike death and taxes, stamp duty can be avoided in certain situations.
Most of us will only encounter stamp duty when it comes to purchasing a home, other real estate (eg. an investment property) or when purchasing an established business (with or without land included). There are many other transactions which attract stamp duty under theStamp Duties Act. Care should be taken and advice sought from a solicitor whenever you are involved in any transaction which involves the transfer of ownership in an asset, including non-tangible assets such as a licence or intellectual property.
Perhaps the most common stamp duty exemption is available to married couples or to domestic partners (or former married couples or domestic partners) where it involves the transfer of a shared residence from one partner's name into both names or vice versa. "Shared residence" means the principal place of residence of which both or either spouse or domestic partner is the legal owner. In the case of spouses or domestic partners who have separated, a "shared residence" will include the couple's last principal place of residence of which both or either of them was a legal owner.
There is however an additional condition that applies in the case of a transfer of a shared residence (or a motor vehicle) between married or domestic partners who have separated or divorced. In particular, the Commissioner of Stamps must be satisfied that the subject transfer was executed as a result of the irretrievable breakdown of the parties' marriage or relationship. Quite often this condition is satisfied by the parties completing a statutory declaration in a prescribed form in which they declare that their marriage or domestic partnership has irretrievably broken down as well as providing any other evidence the Commissioner may require.
An exemption from stamp duty can also be claimed in relation to the transfer of other assets, for example an investment property, shares or trust assets, under a marriage or domestic partnership breakdown. The exemption is only available where the parties have in place either a 'Family Law Agreement' or 'Family Law Order' (in the case of married couples who have separated or divorced) or a 'Certified Domestic Partnership Agreement' or 'Property Adjustment Order' (in the case of domestic partners who have separated). We strongly recommend you consult a family law solicitor to assist you in any of these cases.
Other common exemptions from stamp duty include:
- The transfer of a deceased person's estate to a beneficiary under a Will or an intestacy (where there is no Will). Care should be taken however where beneficiaries agree to distribute a deceased estate in a different way than as provided in the Will because this may inadvertently attract stamp duty. For example, if a Will leaves a house property to a beneficiary but that beneficiary decides to put the house property into joint names with someone who is not a beneficiary, then the interest acquired by that other person will attractad valoremstamp duty. Similarly, where a beneficiary relinquishes or assigns his or her interest in a deceased estate to another and does not receive any other asset from the estate of equal value in exchange, then stamp duty will be payable on the value of the asset or interest disclaimed or assigned to another. If you are looking at agreeing to divide estate assets in a manner that is different to what is provided under a Will or the intestacy laws, then we strongly advise you consult a solicitor practising in deceased estates.
- The transfer of a family farm between related parties where the subject land is used wholly or predominantly for the business of primary production, is greater than 0.8 hectares and a business relationship existed between the parties for at least 12 months before the transfer was executed.
- Commercial or residential leases entered into on or after 1 July 2004.
- Mortgages and other charges on land if dated on or after 1 July 2009.
Stamp duty concessions are available on the transfer of an "Off-the-Plan Apartment" where it concerns the purchase of a new apartment or substantially refurbished apartment within the Adelaide CBD and its inner suburban fringes. Visit Revenue SA for more information about this.